Employers have responded to workers changed workplace benefits needs by rethinking benefits policies, plan design and offerings, according to a new report.
Because of the COVID-19 pandemic and resultant tight labor market employers are competing for talent by re-examining their workplace benefits the “NFP 2022 Benefits Trend Report” finds. Among employers, 45% say that their primary strategic obstacle in human resources is being challenged by rapid growth and/or higher turnover within their organizations, the report explains.
“In the wake of the pandemic, a tight labor market and shifting employee priorities, the workforce has changed dramatically–and so have their needs,” said Kim Bell, executive vice president and head of health and benefits, at NFP, in a release. “It is more important than ever for employers to get benefits right, and those who respond with policies and offerings that promote mental health, access to quality health care and life-work integration will be the talent leaders of tomorrow.”
Among employers, top options to increase employee satisfaction focus on additional benefit choices and customization, (37%) and improved communication, (33%). This is highlighted by most employers incorporating a so-called benefits “re-set” to assist employees’ mental well-being and flexibility, the report finds.
In the last 18 months to one year, 65% of employers surveyed have incorporated alternative work schedules and three-in-four plan to make the change permanent.
“It’s time to embrace the home as a key part of the workplace,” said Deb Smolensky, senior vice president, global practice leader for well-being and engagement, in the report. “Employers have to focus their well-being strategies on the home environment and daily life challenges.”
The report also finds that two-thirds of employers have adjusted their paid time off and leave policies to assist with workers mental health, 51% provide online mental health resources, 35% provide health coaching, 29% offer in-office mental health resources and 22% invest in peer support groups.
“Nearly every component of employee well-being—mental, physical, financial, social, career—has suffered over the past two years, prompting employees to rethink their jobs and benefits priorities,” added Smolensky, in a release. “While employees want fulfilling work experiences, they want their lives—not their work—to come first. The goal is no longer work-life balance, its life-work integration.”
According to data from Voya that is cited in the report, 70% of workers are more likely to work for an employer offering employee-paid voluntary benefits.
Data from MetLife cited in the report shows that workers and employers don’t consider which benefits are essential in the same way. The NFP report shows 2021 MetLife data found that 44% of employees say critical illness insurance is a must and 29% of employers offer it; 38% of employees view hospital indemnity as a must, despite only of 22% employers that offer it and while 32% of employees consider homeowners’ insurance a must 22% offer it.
For employers and workers, health care expenses—during a workers’ career and into retirement—are an increasing concern, the report finds. According to the 2022 annual estimate from Fidelity Investments, health care in retirement will cost an average of $315,000.
With U.S. health expenditures expected to increase by 47% by 2028, two-thirds of employers want to implement a benefits program that can contain costs, according to the NFP report. For employers inclined to make a change, 22% are extremely willing, 40% are very willing, 28% moderately willing and 8% are slightly willing to implement a program alteration to limit costs, the report finds.
The report also showed that among employees 64% view financial benefits as within the top five offerings to assist workers with financial concerns but 37% of employers are planning “to invest more in such benefits after COVID-19,” the report states.
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